Unnamed Analyst
Appearances
Apple News Today
Inside the fallout of a stunning national-security leak
Any security professional, military, government or otherwise, would be fired on the spot for this type of conduct and criminally prosecuted for being so reckless with this kind of information. The fact that she wouldn't be held accountable for this, I think, blows the mind of anyone who's held our nation's secrets dear.
Apple News Today
Inside the fallout of a stunning national-security leak
But they had the keys to the kingdom, and he had these lieutenants ready to go in these kind of nondescript government agencies, and then fanned out from there.
Apple News Today
Inside the fallout of a stunning national-security leak
They went into these first, they figured out the systems, they put their people in place, and we're talking, you know, as we reported, a cohort of very young, not experienced technologists and engineers, and we've just never seen anything like this before.
Morning Wire
Trump’s Retaliatory Tariffs & North Carolina Recovery | 2.11.25
I believe that this Doge program in my adult life is one of the most important audits of government or changes to government structure we have seen.
Morning Wire
Trump’s Retaliatory Tariffs & North Carolina Recovery | 2.11.25
There's a lot of misinformation out there. First of all, when you say the Doge team, these are Treasury employees, two Treasury employees, one of whom I personally interviewed in his final round. There is no tinkering with the system. They are on read-only. They are looking. They can make no changes. It is an operational program to suggest improvement.
WSJ What’s News
Trump Officials Debated War Plans on Unclassified Chat App
This is one of the most stunning breaches of military intelligence I have read about in a very, very long time.
WSJ What’s News
Trump Officials Debated War Plans on Unclassified Chat App
The detention happened as Western companies were already feeling uneasy about operations in China. There had been multiple reports of exit bans of foreign staff, which essentially meant that these people were forbidden from leaving China because they were involved in government investigations and often really opaque ones. and it had introduced a suite of new laws to govern that.
WSJ What’s News
Trump Officials Debated War Plans on Unclassified Chat App
Mintz, being a due diligence firm and also involved in corporate investigations, basically represented the possible fate of other foreign companies dealing with data if they too ran afoul of these new rules.
WSJ What’s News
Trump Officials Debated War Plans on Unclassified Chat App
It comes at a time when Beijing is launching its own charm offensive to woo Western businesses back to invest in China again, as Chinese officials are struggling to kickstart their own economy. Over the past two days, Beijing has held an annual forum, which is attended by prominent foreign businessmen and Chinese leaders.
WSJ What’s News
Trump Officials Debated War Plans on Unclassified Chat App
And at that forum, Chinese officials basically touted their country as a force for stability and open trade.
Wall Street Breakfast
Recession risk and pockets of strength
And they were also benefiting from a cost cutting regime, not an aggressive one, but one that sort of was eyeing cost cutting as a goal. So They were helped margin-wise there. So you can't expect that from every company. And I think what we're learning From the recent past is that when you're dealing with high-risk assets, those can go up very quickly, but those also come down.
Wall Street Breakfast
Recession risk and pockets of strength
So a lot of the damage that's been done recently has been done in kind of those higher-risk areas, technology, crypto, those kind of spaces. But there are pockets of strength in the more defensive sectors. If you look at the performance of the major averages so far, This year, you can see the bifurcation.
Wall Street Breakfast
Recession risk and pockets of strength
So the NASDAQ is down around 4% year to date, but the Dow is basically flat and you have the worst Dow components are Salesforce and Nvidia, both down about 13% so far this year. But if you flip it around and look at the best Dow components, you have Amgem, you have 3M, You even have IBM as sort of an old fashioned technology play doing well within the Dow.
Wall Street Breakfast
Recession risk and pockets of strength
So there are pockets of strength, even though the overall sentiment over the past week certainly has been down. On the upside, like I said, it's kind of limited. It's more companies that are sort of holding up despite the news. The downside, you have a very heavy sort of AI market. technology segments moving down. So Nvidia was down 11% in the past week, you have ARM down 10%, Broadcom was down
Wall Street Breakfast
Recession risk and pockets of strength
10%. Oracle, which has earnings next week, was down 6%. Oracle is a good one to look at because they have the results coming out early next week. They're a company that has been spotlighted as a kind of an AI name. So look for commentary from them about their AI progress.
Wall Street Breakfast
Recession risk and pockets of strength
I would also look at their spending, their CapEx, which has been going up lately as they kind of lay the infrastructure for the push, a bigger AI push. And I think that's a theme that we'll be looking at a lot with the excitement of, say, NVIDIA in the first sort of year and a half of the AI boom rising significantly. All those chips are being bought by somebody.
Wall Street Breakfast
Recession risk and pockets of strength
So one of the things to watch out for is just cost that AI has in actual dollar terms as these companies try and sort of get ready, gird up for the battle ahead.
Wall Street Breakfast
Recession risk and pockets of strength
I mean, I think that's a worry. I think the worry is that the revenue from additional AI investments is not going to come as fast as we had hoped. Meanwhile, the costs are happening now. So the idea that the profits from this are going to be delayed In terms of actual trading, I think it's more just sort of a high risk, low risk situation.
Wall Street Breakfast
Recession risk and pockets of strength
I think it was a risk off kind of move for the stock market. And I think the test for that is crypto, which is also down kind of in lockstep with tech stocks in general. So if you could kind of look at The NASDAQ is down 4% year to date. Bitcoin is down about 3%. So those two are kind of moving in tandem.
Wall Street Breakfast
Recession risk and pockets of strength
stocks that have been moving up recently despite kind of the bad headlines that we've been facing one is budweiser keeps pushing higher as we're recording it's been up for 10 consecutive sessions it's only been down twice in the last 17 sessions it had results out last week uh they they were obviously taken positive by the market but it was already drifting higher from there.
Wall Street Breakfast
Recession risk and pockets of strength
And I think it's just generally people are rotating out of tech and looking for safer investments as the economic picture becomes less enticing.
Wall Street Breakfast
Recession risk and pockets of strength
So in the short term, I like to use Bitcoin as a risk asset indicator because unlike an individual company might have fundamentals that are specific to that company, but Bitcoin doesn't have earnings reports or things of that nature that affect it. So you can kind of take its short-term movements as a sentiment indicator, especially as it relates to higher risk assets.
Wall Street Breakfast
Recession risk and pockets of strength
To your point though, there are... structural activities that are changing the way Bitcoin is being viewed by the public. So I think if you're looking long-term at Bitcoin, you're still looking at things like institutional adoption. You're looking at expanding its prevalence as an actual currency, as opposed to an investment.
Wall Street Breakfast
Recession risk and pockets of strength
And if there's progress in those areas, then Bitcoin has kind of an engine higher that's individual stocks might not have. So I think that's a point well taken.
Wall Street Breakfast
Recession risk and pockets of strength
And so if you're an investor out there and you're looking at crypto, you have to kind of take the short term volatility, which is more of a sentiment play against what you view as sort of the longer term fundamentals, which would be sort of the expansion of the adoption of the crypto.
Wall Street Breakfast
Recession risk and pockets of strength
So the general feeling is that the economy is not looking as sweet as it was even a month ago. The Atlanta Fed has an interesting project that they do. It's called GDP Now. It's a mathematical algorithm that takes incoming economic data and spits out a prediction for what GDP is going to be. And that's reached a point where it's predicting a contraction of more than 2% for the first quarter.
Wall Street Breakfast
Recession risk and pockets of strength
And a lot of that damage has happened very recently. So at the beginning of February, that was still predicting a 3% growth for the first quarter of 2025. And now it's predicting More than 2% decline. And that got as sharply down as 2.8%. And that was right after the ISM manufacturing data that came out earlier this week.
Wall Street Breakfast
Recession risk and pockets of strength
That showed that manufacturing in general was just above the line for contraction. That index has a 50 as the break-even point. So anything below 50 is contraction. Anything above 50 is expansion. And it was at 50.3. So just in the expansion territory. And then some of the sub-indexes like new orders and employment were both below 50.
Wall Street Breakfast
Recession risk and pockets of strength
So once that got computed into the Atlanta Fed's algorithm, it brought the GDP prediction for the quarter way down. So that's not even taking into account the possible impact of tariffs. That's completely mathematical model based on incoming economic data. So tariffs about to take effect aren't even, priced into that at all.
Wall Street Breakfast
Recession risk and pockets of strength
So that's one stock that's sort of bucking the overall downward trend that the market has seen.
Wall Street Breakfast
Recession risk and pockets of strength
And so that leaves a lot of analysts worried that the tariffs might be sort of the tipping point event that pushes the economy into a serious recession.
Wall Street Breakfast
Recession risk and pockets of strength
So next week in terms of earnings, we have a bunch of more retailers coming out. The retail sector is down about 10% since mid-February. So that's investors taking into account this softening economic environment and thinking that consumers both with inflation remaining pretty sticky and the labor market softening that there might be a lot of sort of household budget cuts being made.
Wall Street Breakfast
Recession risk and pockets of strength
So look for the retailers coming out, especially we have Dollar General and Dollar Tree. So those are interesting just because they're at the very low end of the pricing specter. So the commentary you can get from them might be very interesting in terms of how consumers are reacting. to the economic information. Also next week, there's a CPI coming out on Wednesday.
Wall Street Breakfast
Recession risk and pockets of strength
That's going to be an important indicator. The commentary around the Fed has shifted more towards the economy and more towards jobs and more towards fear of a recession than it has to fighting inflation. So to a certain degree, maybe the CPI is becoming more relevant in the Fed decision-making, but it'll still be interesting to see where that stands.
Wall Street Breakfast
Recession risk and pockets of strength
So that was more of an execution story. They also said that they didn't see a heavy impact from tariffs. At that point, when they were talking, tariffs were more conceptual than they were, something that was definitely on the horizon. But even in that context, they said that they weren't particularly worried about it. And so coming from a global operation like that, investors took that to heart.
Wall Street Breakfast
Recession risk and pockets of strength
And obviously a softer inflationary report kind of opens the door for a sooner rate cut. If that remains dangerously high, then the Fed might have no other choice but to hold off on rate cuts and risk the recession.
Wall Street Breakfast
Recession risk and pockets of strength
But the problem is that that might be very specific to that company. They also showed some signs of weakness. Revenue was up, but volumes were down. So they were taking advantage of higher prices. So that was a situation where inflation was kind of working in their favor.